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Innovation in services: a review of the debate and a research agenda

Abstract

The paper reviews the debate on innovation in services which has flourished over the last 20 years and suggests a research agenda for the services innovation literature. We discuss whether, and the extent to which, the ill-definition and mis-measurement of service output have influenced the conceptualization and analysis of innovation in services. We propose a reclassification of the literature according to whether it has been mainly assimilated or differentiated with respect to the traditional conceptualization of innovation in the manufacturing sector. We also review the integrative (or synthesizing) contributions, and suggest a taxonomy for the modes of innovation in services, based on the Lancasterian characteristics-based approach to product definition. We conclude with a summary of the key arguments and a proposed agenda for the evolutionary theory to integrate the conceptualization of innovation in services.

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Fig. 1

Notes

  1. 1.

    For a review of the two opposite approaches of post- and neo-industrialists, see the extensive review provided by Delaunay and Gadrey (1992). See also Petit (1986) and Schettkat and Yocarini (2006).

  2. 2.

    It is beyond the scope of this paper to provide an overview of the classical tradition. However, it is interesting to consider here that Marx’s classification of service activities was mainly based on the social and economic relationships underlying the provision of services, rather than the physical manifestation of such provision. Interestingly, he considers transport services to be part of industrial production, and therefore part of the material sphere, as well as a source of surplus value. Unlike transport, trade and banking are categorized as belonging to the sphere of “commercial and financial capital”; they produce neither value nor surplus value, but only add to the profits. More specifically, these activities are not labelled unproductive because of their immateriality, a criterion that many scholars applied at the time; instead, they were seen as part of more a complex speculation as far as their role within the social reproduction of capital was concerned (Delaunay and Gadrey 1992).

  3. 3.

    See also Windrum et al. in this special issue.

  4. 4.

    We refer to Evangelista (2000) and Evangelista and Savona (2003) for the methodological details of the empirical analysis carried out to identify the technological trajectories and map the service sectors.

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Acknowledgements

This research has been supported by the EC within the context of the FP7 ServPPIN (The Contribution of Public and Private Services to European Growth and Welfare, and the Role of Public-Private Innovation Networks) Project.

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Correspondence to Faïz Gallouj.

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Maria Savona is also Research Fellow at the Cambridge-MIT Institute, University of Cambridge and at SPRU, Science and Technology Policy Research, University of Sussex, UK. The authors gratefully acknowledge the suggestions from two anonymous referees. The usual disclaimers apply.

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Gallouj, F., Savona, M. Innovation in services: a review of the debate and a research agenda. J Evol Econ 19, 149 (2009). https://doi.org/10.1007/s00191-008-0126-4

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Keywords

  • Innovation
  • Service sectors
  • Characteristic-based approach

JEL Classification

  • L80
  • O30
  • O33